Here’s a startling statistic: 60% of CFOs responding to a recent study indicated they lack complete visibility into their organization’s transactions.
Pretty scary stuff when you think about it: The person in your company who is responsible for setting finance strategy may not be aware of everything that is going on when it comes to what is being purchased and paid for within your organization.
The Economist Intelligence Unit’s report, entitled “The Strategic CFO in a Rapidly Changing World,” was based on its findings from a survey of over 500 CFO’s and other senior executives with responsibility for finance.
While the results are startling, there is something CFOs can do to gain visibility into all transactions within their organization. They can deploy technology solutions that cover the entire procure-to-pay process.
Automating the procurement process and adding procedures that delineate who can buy what, and from whom, gives insight into a company’s direct spend but also helps to cut waste in the area of indirect spend. This is the one area where financial officers often have a very incomplete picture of what’s going on in part because businesses tend to silo information in departments rather than seeing that information flows freely among various departments.
Financial process automation sets “rules of engagement” that must be followed by everyone who is authorized to make a purchase on behalf of the company. And it also clearly lays out what will happen from the time a purchase order is received until payment is remitted, regardless of which department is involved in the transaction.
Giving your CFOs greater visibility into all transactions throughout your company will allow the finance department to take on a more strategic role in your operation. This will improve cash management and position it to react more effectively to changing market conditions.